MEMPHIS, Tenn. — ‘Made in the USA.’ The label appears on products from household items to cars. Now, the Federal Trade Commission (FTC) is strengthening guidelines on products using a ‘Made in the USA’ label.
ABC24 spoke with Randy Hutchinson from the Better Business Bureau of the Mid-South (BBB) about what the new regulations mean for consumers.
With some exceptions, manufacturers and marketers aren't required to disclose where products are made. But if they do and make a blanket statement that they're made in the USA, it better be true.
What are the rules?
According to the FTC, an unqualified ‘Made in USA’ claim requires that all or virtually all of a product has been made in the United States. All significant parts, processing, and assembly, and the labor that goes into the product must be of U.S. origin. There should be no or negligible foreign content.
If a company implies the claim of being ‘Made in the USA’, then its also subject to rules. As an example, touting the ‘true American quality’ of work performed at an American factory would be misleading if the components assembled in the U.S. are actually made overseas. A company saying "our products are made in the USA" would violate that requirement if only some are.
Qualified claims such as "Assembled in USA" are okay, as long as they are true.
Lawsuits filed over Made in the USA claims
The FTC recently settled a lawsuit against a company that violated these new rules. A company called Lithionics claimed its battery products were ‘Made in the USA.’ But the FTC said its lithium ion cells were actually imported from China. Other components were also imported. They said a YouTube video featured the owner sticking ‘Made in USA’ labels on products, and marketing materials compared the advantages of its products over competing products that are imported.
So what can consumers do?
Verifying the origin of most products would be impossible. Be sure the manufacturer or marketer making the claim has a good reputation, which makes it more likely the claim is accurate.
Also, read labels carefully to pick up on any qualifications.